Occidental Petroleum Faces Challenging Q3 Earnings Report Ahead
Occidental Petroleum Corporation (OXY), based in Houston, Texas, stands as a key player in the energy sector, focusing on oil, natural gas, and chemical production. Currently, the company has a market cap of $45.80 billion and operates in various regions, including the U.S., Middle East, and Latin America. Known for its commitment to sustainable energy and advanced oil recovery techniques, Occidental is preparing to publish its Q3 earnings report on Tuesday, Nov. 12, after the market closes.
Analysts Predict a Decline in Earnings for OXY
In anticipation of the upcoming report, analysts forecast that OXY will post a profit of $0.84 per share. This figure reflects a significant decrease of 28.8% from last year’s $1.18 during the same period. Notably, Occidental has managed to meet or exceed Wall Street’s earnings expectations for the last four quarters.
Previous Quarter Shows Strong Performance
In its last quarter, Occidental achieved adjusted earnings of $1.03 per share, surpassing consensus expectations by 33.8%. This achievement primarily resulted from increased production volumes and higher oil and natural gas liquids (NGL) prices.
Looking Ahead to Fiscal 2024
For the upcoming fiscal year, analysts estimate OXY will report earnings per share (EPS) of $3.43, which represents a 7.30% decline from the previous year’s $3.70.
OXY Stock Underperforms Compared to Market
Year to date, OXY stock is down 13.5%, contrasting sharply with the broader S&P 500 Index’s ($SPX) impressive 23% gains and the Energy Select Sector SPDR Fund’s (XLE) 7.8% returns during the same period.
Recent Debt from Acquisition Impacts Stock Performance
After releasing its Q2 earnings on Aug. 7, OXY stock rose 4.3%. The company reported a modest revenue increase of 1.7% year-over-year. However, rising debt levels following the recent acquisition of CrownRock may have contributed to weaker price momentum. Occidental incurred considerable debt during the $12 billion acquisition, borrowing $9.1 billion and taking on an additional $1.2 billion in existing CrownRock debt.
Analyst Ratings Reflect Cautious Outlook
Current consensus on OXY stock is moderately positive, with a general rating of “Moderate Buy.” Among the 24 analysts tracking the company, six recommend a “Strong Buy,” one advises a “Moderate Buy,” 16 suggest a “Hold,” and one opts for “Strong Sell.” The average price target set by analysts for OXY stands at $64.83, implying a potential upside of 25.5% from its current price.
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On the date of publication, Rashmi Kumari did not possess (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data provided in this article are for informational purposes only. For further details, please refer to the Barchart Disclosure Policy here.
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